India’s Path to Fair Economic Growth: Insights from Sitharaman
Sitharaman pointed out that India’s economy has grown rapidly, moving from the 10th to the 5th largest in just five years.
Sitharaman pointed out that India’s economy has grown rapidly, moving from the 10th to the 5th largest in just five years.
India’s growth story presents more challenges compared to China, which enjoyed a favourable global trade and investment climate in the early 2000s, according to Finance Minister Nirmala Sitharaman.
Speaking at the Kautilya Economic Conclave in New Delhi, she expressed confidence that a new era for India will emerge by 2047, characterised by attributes similar to developed nations, positioning India as a global leader.
Sitharaman pointed out that India’s economy has grown rapidly, moving from the 10th to the 5th largest in just five years.
This growth has happened while keeping inflation low. She predicted that India’s average income, which took 75 years to reach $2,730, could rise by another $2,000 in the next five years.
She believes that the next few decades will bring big improvements in living standards for everyday people, marking an important change for India.
The conclave, organised by the Department of Economic Affairs and the Institute of Economic Growth from 4 to 6 October, aims to foster discussion on pressing global issues.
Sitharaman said that India is becoming fairer, which is shown by a decrease in the Gini coefficient.
This number measures income inequality. A lower Gini coefficient means that the differences in income between people in both rural and urban areas are getting smaller, so there is less inequality.
India wants to double the average income for its 1.4 billion people, who are 18% of the world's population.
To do this, the country needs to deal with pollution from developed countries and move to cleaner energy.
Sitharaman said it’s important for the government to work together on these problems and mentioned that India’s way of using energy could teach other countries something useful.
She talked about how new technologies can affect jobs, saying that the changes could be big, especially since India has many young people and needs to create more jobs.
Sitharaman shared five reasons to feel positive about India’s growth: having a young population, more people buying things, the ability to innovate, a strong banking system, and India’s growing presence in the world.
She said having many young people is good for the country. We need to help them learn new things and stay healthy. As they start buying more, the country will grow because there will be more middle-class families.
Sitharaman expressed confidence in the maturation of India's innovation capabilities, citing improvements in the Global Innovation Index and the successful development of vaccines and space missions as examples of India’s potential.
She highlighted the strength of India’s financial system in promoting inclusive growth and facilitating access to finance.
Sitharaman explained that the government wants to help India grow in a smart way.
She said it’s important to save money and spend it carefully. The government plans to make the money it spends smaller, going from 5.6% to 4.9%. This means they are earning more money and being careful about how they use it.
The Finance Minister reiterated the importance of policy continuity across sectors like infrastructure, banking, and trade, calling for innovation and advancements in productivity.
The government has allocated ₹1,200 crore for research and development projects and established the Anusandhan Research Fund to encourage innovation.
Sitharaman wrapped up by saying that the new Indian era is connected to the country’s rich history and cultural achievements.
By 2047, when India celebrates 100 years of independence, she sees a Viksit Bharat (Developed India) that will not only bring prosperity to its people but also help advance global progress through lively exchanges of ideas, technology, and culture.
The third edition of the Kautilya Economic Conclave aims to tackle today’s economic problems and talk about ways to keep strong growth despite global challenges. NK Singh, the president of IEG, praised Sitharaman for how she managed the economy.
He highlighted her focus on using technology to solve problems and her quick actions during the COVID-19 pandemic, which helped bring about important economic changes and growth.
